Over union objections, GEA to move AC production

GE Appliances said on Friday that despite union objections it would move a supply chain company back into Appliance Park, which will displace 140 GEA workers who make hotel air-conditioners.

The company said that the actions were needed to return the park to profitability and that no jobs would be lost because the workers would be placed in other positions in the park. However, a union leader expressed concerns about the company’s new Chinese owners continuing to move production — and jobs — out of the park, which, he said, was undermining the park’s long-term viability.

General Electric Co. sold its appliance division last year to China-based Qingdao Haier for $5.6 billion.

GEA will move the AC line out of Building 2 to make room for parts supplier Derby Supply Chain Solutions, which was forced out of the park by a warehouse fire and has been trucking in parts from Shepherdsville. The company did not say where it would be moving the line.

Bill Good

“After an in-depth evaluation of all the buildings in Appliance Park, we determined the only feasible location for the SDC is Building 2,” said Bill Good, vice president of GEA’s supply chain network. “This central location next to our largest production operations enables real-time distribution of parts, eliminates production disruptions due to traffic and other transportation-related delays, and allows for rapid transitions to changes in customer orders.”

The company has said that since Derby was forced to move to Shepherdsville, its trucks have gotten stuck on Interstate 65, which has stopped production and prompted GEA to send employees home. About 20 Derby trucks travel between Shepherdsville and Louisville daily to deliver parts including compressors, wire harnesses and circuit boards.

The company announced the plans in May, but the union has been fighting the move.

Dana Crittendon

Dana Crittendon, president of the IUE-CWA Local 83761, which represents the park’s roughly 3,600 hourly workers, told Insider Friday that he and his leadership team believed the company had no intention to seriously consider any of the union’s counter proposals.

Whenever the union presented a solution to the problems the company identified, company leaders moved the goalposts, he said.

Crittendon said the company announced its decision although union leaders were discussing with state officials, including Terry Gill, secretary of the Kentucky Cabinet for Economic Development, solutions to keep the AC line jobs in Louisville. Despite those talks, and the assistance both state and local officials provided, the union president said, the company had decided to move the jobs elsewhere.

“It just tells me … the script was already written,” Crittendon said. “I’m very concerned and I’m very disappointed.”

GEA said in its release that it made the decision “after careful consideration” and that the union’s counter proposals “failed to offer feasible alternatives.”

When Haier bought GEA last year, Crittendon was hopeful that the union would boost business for the venerable American appliance maker, as it provided a path for GEA products to be sold through Haier’s distribution network.

Now, however, he’s not so sure.

“It doesn’t seem like a good thing right now,” he said.

A hybrid water heater that no longer is being made at General Electric Appliance Park | Photo by Boris Ladwig

“There’s always opportunity, but, you know, the owners would … have to be willing to invest and bring more jobs back to Appliance Park,” Crittendon said.

Yet, whenever he inquires about new products that may be coming into the park, he said, none is offered — though company officials told Insider this spring that they planned to expand dishwasher production and add a high-end washing machine.

Instead, Crittendon said, the company has handed warehousing work to a third party, which replaced 200 union jobs with low-paying non-union jobs, discontinued water heater production, which cut another 100 union jobs, and now plans to stop AC production.

None of the workers on the AC line likely will lose their jobs, he said, but even if you move them elsewhere in the park, employment declines when you’re moving production.

It’s like taking cookies from a cookie jar, he said. If you keep eating them and not putting any new ones in, eventually the jar will be empty.